Date: 2024-11-22 Page is: DBtxt003.php txt00022551
INFLATION
MOHAMED EL-ERIAN
CBS Face The Nation ... Strassman, El-Erian, Peterson-Densley
MOHAMED EL-ERIAN
CBS Face The Nation ... Strassman, El-Erian, Peterson-Densley
Original article: https://www.youtube.com/watch?v=Ztn8i_nCLY0
Peter Burgess COMMENTARY
I see Mohamed El-Erian as a very clear-eyed economic analyst who has worked successfully for quite a long time in the real world of finance and investment. It is interesting to find him at Camrbridge where I learned my own economic analysis foundation.
The first half of this program is to do with inflation ... with a big part of the blame for inflation going to the slow response of the US Federal Reserve. While the slow response of the Fed is a valid observation, in my own view, the driver of inflation has much more to do with business and finance decision making than the behavior of the Fed.
Strong fiscal response to the economic issues driven by the COVID pandemic meant that consumer demand dropped much less during the pandemic than business anticipated, and in my view this started modest demand-pull inflation which was welcomed by the financial markets.
In the USA the Biden administration was able to pass a substantial infrastructure investment bill that offers a strong employment foundation for multiple years. I arrive in the USA in the 1960s when the Eisenhower era Interstate Highway System was being built, and this Biden investment initiative (supported by many Republican legislators) has the scale and characteristics of the Eisenhower era and will do a lot of economic and social good ... and even environmental good.
Sadly, the Biden administration failed to pass the companion legislation designed to upgrade the US social support infratstructure of the country. In my view the US has one of the most dysfunctional social support systems of any modern wealthy nation and it is a huge drag on everything that the US wants to and needs to do. To put it bluntly, there is nothing in the modern US social services sector that is world class and for a variety of reasons there are surprisingly high costs with truly poor results.
This is not an accident ... but a result of America's history.
There has been a very small population in North America for most of history. Europeans have only been migrating to the North Anmerican continent since the 1600s ... less than 500 years, with most of the migration in the 19th and 20th centuries. In this time period the slave trade also brought people of African origin to North America in substantial numbers. Also, together with this. indigenous people were pushed off their ancestral lands throughout North America in ways that now seem totally obscene.
The United States of America was created as a national entity in the late 18th century with a very progressive constitution and a solid foundation of basic law derived mainly from European experience to that time. A certain level of stability was achieved by division of power between an executive branch of government, a legislative branch and a judicial branch. More stability was built into the system by having both a Federal Government and geographically diverse State Governments with both seperate powers and overlapping powers.In the bi-cameral legislative branch of the Federal Government there are two senators for each State and there are more than 400 representatives each representing a population of around 750,000 people. (In 2022 there are actually 435 voting Representatives, and based on the 2020 census the average size of a congressional district is 761,179 )
In broad terms, rural America controls the Senate. There are 70
Peter Burgess
Face the Nation
Jun 12, 2022
259K subscribers ... 2,585 views
Missed the second half of the show? The latest on Inflation jumps again as Americans feel pain at the pump, El-Erian says inflation could hit 9% and The Violence Project co-founders on mass shooters, guns and prevention.
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